Public deficit financed by the central bank threatens this business by increasing the quantity of banknotes in circulation and can lead to growing prices in the economy. Inflation is partially caused by the direct spending of the state, and partially by a credit bubble generated by the loosening monetary conditions.

Public deficit financed by the central bank threatens this business by increasing the quantity of banknotes in circulation and can lead to growing prices in the economy. Inflation is partially caused by the direct spending of the state, and partially by a credit bubble generated by the loosening monetary conditions.